Detroit is poised to unveil more muscle cars at its international car show

New GM CEO Launches Next-Gen Canyon2:01

On the eve of the North American International Auto Show in Detroit, General Motors introduced the 2015 GMC Canyon. GM Chief Executive-elect, Mary Barra, said the company saw ?opportunity knocking? as it hopes to unseat Toyota as the leader in the mid-size pickup market. WSJ?s Jeff Bennett reports.

January 13th 2014

3 years ago

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Still under wraps ... General Motors vehicles are under wraps at the Cobo Center, home of the North American International Au...

WITH its derelict buildings and gutted high-rise facades, Detroit may be a grim backdrop for the North American automotive industry.

But as the motor capital of the world gears up for the first international car show of the year, the big US brands have their feet on the gas pedal.

Buoyed by the best sales in six years - after 15.6 million new vehicle deliveries in 2013 - Detroit is back in the fast lane in more ways than one, even if it still trails China as the world's biggest car market (a title it snatched from the US in 2010).

photo gallery2014 North American International Auto Show

The Nissan Sports Sedan Concept vehicle is introduced at the press preview of the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP1 of 21

The Toyota FT-1 concept is unveiled during media previews during the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP2 of 21

The Mercedes -Benz S-Class Coupe concept is introduced at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP3 of 21

2014 North American International Auto Show4 of 21

Kia introduces the GT4 Stinger concept at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP5 of 21

Matthias Muller, President and CEO, Porsche AG poses in the Porsche 911 Targa during media previews during the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP6 of 21

Members of the media look over the Ford F-150 pickup truck after it's introduction at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP7 of 21

Bentley's V8s is unveiled at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP8 of 21

The Chevrolet Corvette Z06 is presented during a press preview at the2014 North American International Auto Show in Detroit, Michigan. Picture: AFP9 of 21

The Nissan Sport Sedan concept is unveiled at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP10 of 21

The General Motors display area is seen at the 2014 North American International Auto Show in Detroit, Michigan. The show is open to the public January 18-26th at the Cobo Center and is expected to draw about 5,000 journalists and 800,000 visitors. Picture: AP11 of 21

The Audi S-8 is unveiled at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP12 of 21

The Volvo XC Coupe Concept vehicle is shown at the press preview of the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP13 of 21

Singer Natalie La Rose helps to introduce the MINI John Cooper Works Concept car at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP14 of 21

The Volkswagen e-Golf fully electric vehicle is displayed at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP15 of 21

The Volkswagen Beetle Dune concept car is unveiled with performers at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP16 of 21

The new Audi Offroad Concept vehicle is revealed at the press preview of the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP17 of 21

Raj Mair, group vp at Ford Motor Company, introduces the new Ford F-150 pickup truck at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP18 of 21

Incoming General Motors CEO Mary Barra introduces the 2015 GMC Canyon during the media previews for the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP19 of 21

John Mendel, Executive Vice President, Auto Sales, American Honda Motor Company, introduces the new 2015 Honda Fit at the press preview of the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP20 of 21

Chevrolet vehicles are shown at media previews at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP21 of 21

The Nissan Sports Sedan Concept vehicle is introduced at the press preview of the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP

The Toyota FT-1 concept is unveiled during media previews during the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP

The Mercedes -Benz S-Class Coupe concept is introduced at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP

2014 North American International Auto Show

Kia introduces the GT4 Stinger concept at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP

Matthias Muller, President and CEO, Porsche AG poses in the Porsche 911 Targa during media previews during the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP

Members of the media look over the Ford F-150 pickup truck after it's introduction at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP

Bentley's V8s is unveiled at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP

The Chevrolet Corvette Z06 is presented during a press preview at the2014 North American International Auto Show in Detroit, Michigan. Picture: AFP

The Nissan Sport Sedan concept is unveiled at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP

The General Motors display area is seen at the 2014 North American International Auto Show in Detroit, Michigan. The show is open to the public January 18-26th at the Cobo Center and is expected to draw about 5,000 journalists and 800,000 visitors. Picture: AP

The Audi S-8 is unveiled at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP

The Volvo XC Coupe Concept vehicle is shown at the press preview of the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP

Singer Natalie La Rose helps to introduce the MINI John Cooper Works Concept car at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP

The Volkswagen e-Golf fully electric vehicle is displayed at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP

The Volkswagen Beetle Dune concept car is unveiled with performers at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP

The new Audi Offroad Concept vehicle is revealed at the press preview of the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP

Raj Mair, group vp at Ford Motor Company, introduces the new Ford F-150 pickup truck at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP

Incoming General Motors CEO Mary Barra introduces the 2015 GMC Canyon during the media previews for the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP

John Mendel, Executive Vice President, Auto Sales, American Honda Motor Company, introduces the new 2015 Honda Fit at the press preview of the 2014 North American International Auto Show in Detroit, Michigan. Picture: AFP

Chevrolet vehicles are shown at media previews at the 2014 North American International Auto Show in Detroit, Michigan. Picture: AP

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Over the coming days Detroit is poised to unveil more muscle cars, a high-powered version of the Corvette and an all-new Ford F-150; the nation's top-selling vehicle for 32 years and the most popular "pick-up" for 37 years in a row.

If it sounds like North America is yet to join the real world by unveiling such automotive excess, think again.

The new Ford F-150 is said to have a lightweight aluminium body, the first such change in the 111-year history of the Ford Motor Company, which is tipped to deliver massive fuel economy savings.

US to unveil more muscle mobilesSource:Supplied

And the new high-powered Corvette sports-car from Chevrolet is said to have a new generation super-efficient V8 engine, even if it's still supercharged.

Nevertheless, when the doors to Cobo Hall open Monday local time for the 2014 Detroit motor show (about 1am AEST Tuesday) the industry will be putting on a brave face.

The city known as Motown is a shadow of its former self, with only two factories remaining, down from more than two dozen of two decades ago.

The population of Detroit is down by more than half, from 1.8 million in 1950 to just over 700,000 today. Unemployment is close to 20 per cent and, last year, Detroit was the largest municipality in US history to go bankrupt.

The murder rate is currently 10 times higher than New York City and 70 per cent of murders remain unsolved.

Most car factories have shifted to other US states, which have offered incentives for greenfield sites established by foreign brands. The Big Three - General Motors, Ford and Chrysler - regard them as the enemy from within.

Gearing up .... The General Motors display area at the North American International Auto Show in Detroit. Picture: APSource:AP

Of the 39 car factories in North America, just two are in Detroit and only seven are in its home state of Michigan.

Having agreed to more flexible contracts with its workers, with support from the states they're based in, the foreign brands have developed an upper hand by setting up elsewhere across the US.

Last year, the Big Three brands built about 7 million vehicles on home soil; foreign brands built more than 5 million vehicles, leaving only about 3 million vehicles imported.

Which is why there won't necessarily be Armageddon when Ford, Holden and (probably) Toyota close their Australian factories.

Last year, Australian vehicle production fell to its lowest levels since 1958; it now represents such a small part of the market, the adjustment to the new world order has, largely, already happened.

Still under wraps ... General Motors vehicles are under wraps at the Cobo Center, home of the North American International Au...Source:AP

The populations of South Australia and Victoria are still growing, and unemployment is below 6 per cent, not as high as 20 per cent like it is in Detroit. Even if every Ford, Holden and Toyota worker did not find another job, the unemployment rate would rise by about 0.9 per cent.

But a study by the University of Adelaide last year found that more than two-thirds of Australia's displaced automotive manufacturing workers will find new employment quickly.

Often overlooked is the fact that, since 2004, Holden alone has let go more than 5000 factory workers; currently there are only 5300 employees on the workshop floors at Ford, Holden and Toyota combined. And Australia appears to have survived the impact so far.

Many auto workers have ended up in other related industries, such as aircraft component manufacturing. US giant Boeing employs 1500 workers near Melbourne to make hi-tech wing components for the new 787 Dreamliner, for example, so highly regarded is our expertise.

Meanwhile, the closure of Holden's factory looks set to open up new opportunities for imported models now that, as insiders put it, "we don't have to put a ring fence around the locally-made models". That means, hopefully, Australians will have an even bigger selection of new cars from which to choose.

So while there will be much sadness about the passing of Australia's automotive manufacturing capability, and the livelihoods it will affect, the reality is it will, ultimately, provide an opportunity to reinvent ourselves. It's the unwelcome jolt we had to have.

Manufacturers in other countries continue to receive substantial taxpayer support - but they have much bigger car markets to sell into. Australia happens to be stuck in a corner of the world surrounded by countries with cheaper labour. No amount of government money could compete with that. Game over.

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